Intrepid Potash, Inc. (NYSE:IPI) investors should pay attention to a decrease in hedge fund sentiment recently.
To the average investor, there are a multitude of metrics market participants can use to track the equity markets. A duo of the best are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top hedge fund managers can trounce their index-focused peers by a very impressive amount (see just how much).
Equally as beneficial, bullish insider trading sentiment is a second way to parse down the financial markets. Just as you’d expect, there are many reasons for a corporate insider to downsize shares of his or her company, but only one, very simple reason why they would buy. Various academic studies have demonstrated the impressive potential of this method if “monkeys” understand what to do (learn more here).
With these “truths” under our belt, let’s take a peek at the recent action regarding Intrepid Potash, Inc. (NYSE:IPI).
How are hedge funds trading Intrepid Potash, Inc. (NYSE:IPI)?
At year’s end, a total of 5 of the hedge funds we track were long in this stock, a change of -50% from the previous quarter. With the smart money’s sentiment swirling, there exists a few noteworthy hedge fund managers who were upping their holdings significantly.
When looking at the hedgies we track, Chuck Royce’s Royce & Associates had the biggest position in Intrepid Potash, Inc. (NYSE:IPI), worth close to $77.5 million, accounting for 0.3% of its total 13F portfolio. Coming in second is Jim Simons of Renaissance Technologies, with a $17.4 million position; 0.1% of its 13F portfolio is allocated to the company. Some other hedgies with similar optimism include Richard Chilton’s Chilton Investment Company, Phill Gross and Robert Atchinson’s Adage Capital Management and Ken Griffin’s Citadel Investment Group.
Because Intrepid Potash, Inc. (NYSE:IPI) has witnessed bearish sentiment from the smart money, we can see that there lies a certain “tier” of fund managers that slashed their positions entirely at the end of the year. It’s worth mentioning that Steven Cohen’s SAC Capital Advisors cut the largest position of the 450+ funds we watch, comprising an estimated $1.8 million in stock., and Peter Rathjens, Bruce Clarke and John Campbell of Arrowstreet Capital was right behind this move, as the fund cut about $1.1 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 5 funds at the end of the year.
How are insiders trading Intrepid Potash, Inc. (NYSE:IPI)?
Insider buying is most useful when the company in question has seen transactions within the past six months. Over the last six-month time frame, Intrepid Potash, Inc. (NYSE:IPI) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Intrepid Potash, Inc. (NYSE:IPI). These stocks are Terra Nitrogen Company, L.P. (NYSE:TNH), Scotts Miracle-Gro Co (NYSE:SMG), American Vanguard Corp. (NYSE:AVD), CVR Partners LP (NYSE:UAN), and Rentech Nitrogen Partners LP (NYSE:RNF). This group of stocks are in the agricultural chemicals industry and their market caps are similar to IPI’s market cap.